EIA US Stocks Preview: Crude Build Expected and Product Stocks to Stay Low

EIA Oil Inventory Preview: The EIA weekly petroleum status report will be released at 10:30 ET (15:30 BST) today.

• Crude inventories are expected to build by +1.89mbbls for the week ending 4 Aug according to a Bloomberg survey after the record draw of -17m seen last week. Crude stocks last week saw a record decline due to a rise in crude exports back above 5mbpd and with a big correction in the oil adjustment figure. US gulf coast crude inventories fell by a record volume. US refinery utilisation is expected to increase by +0.15% after falling back to 92.7% last week. The WTI-Brent spread has again closed slightly this week to -3.85$/bbl supported by the declining stocks at Cushing and with strong volumes of US crude offered and delivered into the Dated Brent benchmark. AlphaBBL expect a very small Cushing stock build this week of +0.043mbbls.
• Total US gasoline stocks are expected to remain relatively unchanged with a small draw of -0.06mbbls this week and distillates expecting a small build of 0.2mbbls according to a Bloomberg survey. Diesel stocks remain at the lower end of the five year range after a draw last week with a drop in imports set against slightly higher production. The US became the top-supplier of diesel to Europe for the first time in July. It’s share of European diesel imports has grown from an average of 5% of the imports last year to around 25%.
• Gasoline stocks built last week due to higher import and production and with a drop in exports. Imports could fall this week with ship tracking showing European gasoline into the US fell by 14% week-on-week to 270k b/d in the 7-days to 4 Aug according to Bloomberg.
• The four week average finished gasoline implied demand fell further last week to the low end of the previous five year range to extend the decline seen over the last month. US gasoline demand was back above 9mbpd and 1.5% above the four week average according to the latest GasBuddy data earlier this week. EIA finished gasoline supplied for the week ending 28 June was last week shown at 8.84mbpd. Four week distillate demand was last week unchanged despite a small rise in the weekly data.
• The API data released last night showed a crude build of +4.07mbbls with a draw of -0.11mbbls at Cushing. Gasoline inventories showed a draw of -0.41mbbls and distillates a draw of -2.10mbbls.